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Drivers Start to Worry

Posted on: Tuesday, 16 August 2005, 12:01 CDT

Two-thirds see problems in fuel price

By WILL LESTER Associated Press

WASHINGTON -- More people are feeling that record-high gas prices soon will have their wallets running on empty.

Almost two-thirds of those surveyed for an AP-AOL poll expect fuel costs will cause them financial hardship in coming months. That's sharply higher than in April, when about half felt that way.

"I filled up last Monday and it cost me $53," said Gary Spaulding of Fulton, N.Y., referring to his Ford Explorer. "One of the cars we're going to get rid of. We can't afford both of them."

The average price of a gallon of regular gasoline is more than $2.40 per gallon, compared with $1.86 a year ago and about $2.21 in April, according to the auto club AAA.

And costs are expected to keep rising: Prices for crude oil reached a record of more than $66 a barrel Friday. That's almost 50 percent higher than a year ago.

The poll conducted for The Associated Press and AOL News found that 64 percent say gas prices will cause money problems for them in the next six months. In April, 51 percent expressed such concerns.

Those most likely to be worried are people with low incomes, the unemployed and minorities. However, the level of concern was rising fastest among women, retirees, married people and those living in the suburbs.

"If it gets any higher, I won't be able to drive," said Lois Zumm, a semiretired library worker from Fox Lake, Wis. "I live off my Social Security mostly. And I've got to save something for winter because the heating costs are going to be out of this world."

Filling up with regular gas for the driver of a subcompact with a 12-gallon tank has increased from more than $22 a year ago to more than $28 now. Filling up with premium gas for the driver of an SUV or a big truck with a 30-gallon tank has increased from $60 a year ago to more than $79 now. Premium gas typically is $2.65 a gallon now and was just over $2 a year ago.

"It cost $65 last week for a fill-up of our Expedition," said Carla Woyden, a mother of four from the Philadelphia area. "My husband travels a lot for his job. If he has to drive that (car) around to every corner of the East coast, we're in a lot of trouble."

Richard Curtin, director of consumer surveys for the University of Michigan, said high gas prices can dampen enthusiasm even when the rest of the economy is good.

"It has a rather large effect on the public's mood about the economy, especially among lower-income households," he said. "It directly reduces their spendable income because they are not able to conserve their use of gas very easily -- their trips to work and to the store."

Only about a third in the poll said they think President Bush is handling the nation's energy problems effectively, while almost six in 10 disagree. When asked whom they blame most for the rise in gas prices, people were most inclined to blame the oil companies, followed closely by politicians and countries that produce oil.

"I think they're all in cahoots," said Anna Marie Richard of Granada Hills, Calif.

David Svoboda, who lives near Steubenville, Ohio, said Americans looking to blame someone need to look in the mirror.

"We're not doing enough ourselves -- buying the big SUVs -- we don't seem to care," he said.

The AP-AOL News poll of 1,000 adults was conducted Aug. 9-11 by the Ipsos polling firm. The survey has a margin of sampling error of plus or minus 3 percentage points.

Web site:

Ipsos: www.ap-ipsosresults.com

Fuel increases may curb driving

By RUSSELL RAY World Staff Writer

Terresa Isreal is driving a lot less now that gasoline prices in Tulsa have risen to gut-wrenching levels.

Tulsa-area pump prices have jumped 30 cents a gallon in less than two weeks.

Most gas stations were charging $2.37 to $2.39 a gallon for regular-grade gasoline Friday. That's a few cents shy of the national average -- $2.41 a gallon -- reported by AAA.

Pump prices could move higher this weekend because the price of oil, the feedstock for nearly all transportation fuels, closed at a record high Friday -- $66.86 a barrel.

As she filled her sport utility vehicle with gas near 61st Street and Lewis Avenue, Isreal said what a lot of motorists were probably thinking as they filled up Friday.

"I wish I would have done this two days ago," the Sand Springs woman said.

Gasoline prices were 10 cents a gallon cheaper Wednesday.

"I'm not filling it all the way," Isreal said. "It makes me sad when I fill it all the way up."

To preserve fuel, Isreal has been trying to get more done with fewer trips in her SUV.

"You try to do everything as you're going in that direction," she said.

Les Teague of Owasso appeared unfazed by the soaring prices.

Teague wasn't going to let the higher price of fuel stop him from having a day of family fun at Fort Gibson Lake on Friday.

"If gas was 4 bucks a gallon, we'd still be out here," he said. "We all enjoy it. It's family bonding time."

To fill his boat with fuel, Teague pumped 54 gallons at a cost of $129. He bought an additional $48 worth of gasoline for his pickup.

"Gas is high, but so is everything else," he said. "The other night I took my girls bowling. For four of us to go bowling for two hours, it cost me $40."

Others, however, are changing their driving habits.

"I don't go anywhere except where I have to," Al Statham said after purchasing fuel at a station near 91st Street and Yale Avenue.

The government could ease the financial burden for consumers by lowering state and federal taxes on gasoline, Statham said.

For every gallon of gasoline purchased in Oklahoma, a motorist pays 35.4 cents in taxes -- 18.4 cents to the federal government and 17 cents to the state.

State Question 723 would raise the per-gallon tax on gasoline and diesel by 5 cents and 8 cents, respectively. A statewide vote on the proposal will be held Sept. 13.

But the biggest impact on gasoline prices is the price of oil, not taxes. The price of crude accounts for 50 percent of the cost of gasoline, according to a state study.

Before settling $1.06 higher at $66.86 a barrel, the price of oil peaked earlier Friday at $67.10 on the New York Mercantile Exchange. Oil prices are 46 percent higher than a year ago.

Crude prices have risen to new highs for a number of reasons.

Chief among them is a tight supply of oil. With world oil demand exceeding 83 million barrels a day, spare production capacity has diminished to just 1.5 million barrels a day.

Already concerned about the industry's ability to meet demand, traders were further put on edge when supplies were disrupted by a number of refinery problems in the United States in recent weeks. The supply disruptions came as U.S. refineries were running near full capacity to meet demand.

About the same time, Saudi Arabia's King Fahd died, creating more concerns about terrorist attacks in the Middle East and potential disruptions in supplies.

Fahd's death was followed by threats against U.S. entities in Saudi Arabia. The threats prompted a closing of the U.S. Embassy and consulates in Saudi Arabia.

Oil markets are especially sensitive to any potential threat to the stability of Saudi Arabia because the kingdom controls one- fourth of the world's oil reserves.

All of these factors are driving prices for oil and gasoline to record levels.

In Oklahoma, a gallon of regular gasoline is averaging $2.28, according to AAA's Daily Fuel Gauge Report. Average pump prices in neighboring states are: $2.29, Arkansas; $2.30, Missouri; $2.33, Texas; and $2.37, Kansas.

Motorists in Oklahoma City are paying an average of $2.27 a gallon for regular gasoline.

In Tulsa, the wholesale price of regular fuel is averaging $2.339 a gallon, 3 cents to 5 cents below the city's dominant retail price.

But Oklahoma, which is rich in oil and natural gas, benefits more than it suffers from high energy prices, state officials say. Rising energy prices have created more jobs, higher incomes and more revenue for the state.

Hundreds of Oklahoma oil wells that were too expensive to operate when prices were low have been returned to production. Today's prices justify the expense.

The price of Oklahoma sweet crude, the state's most abundant grade of oil, rose $1 Friday to $63.50 a barrel.

Russell Ray 581-8380

russell.ray@tulsaworld.com

Source: Tulsa World

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